Hoover-Era Ghost Stories No Longer Apply

A very old story is once again being retold, with a few of the characters'
names updated to besmirch the innocent. In this story, conservatives are to
blame for an economic crisis because they allegedly believe there is no role
for government in the economy, and all economic crises are due to lax
regulation of markets.

Cokie Roberts recently gave a sense of how old this story is on ABC's "This
Week." She said of John McCain, "He's a Republican, and whenever Republicans
get into this kind of mess, everybody, even people who were not born or
close to being born, the specter of Herbert Hoover comes out to haunt them."

Everybody?

Roberts is correct in one sense. The specter of Herbert Hoover is conjured
every time there's an economic calamity, large or small.

But you know what? Specters are ghosts. And ghosts aren't real.

The Herbert Hoover of popular imagination was a laissez-faire lickspittle of
Adam Smith. But this idea began as Rooseveltian propaganda and endures as
the creation myth of modern liberalism.

William Leuchtenburg, possibly the greatest authority on the FDR era, wrote
some time ago, "Almost every historian now recognizes that the image of
Hoover as a 'do-nothing' president is inaccurate."

After the stock market crash of 1929, Hoover browbeat business leaders to
keep wages and prices high. He invested heavily in public works projects. He
pushed for an international moratorium on debts. He created the
Reconstruction Finance Corporation, which later became a home for many of
FDR's Brain Trusters. Hoover increased farm subsidies enormously.

Some of Hoover's interventions were good but ineffectual. A few were very,
very bad and very effective.

In 1932, Hoover in effect repealed Calvin Coolidge's tax cuts, increasing
the rates for the poorest taxpayers by more than 100 percent and hiking the
top rate from 25 percent to 63 percent. Worse, contrary to his own better
instincts, Hoover signed the disastrous Smoot-Hawley trade bill that raised
protectionist walls at precisely the moment the world needed trade the most.

Then there's this idea that FDR rode to the rescue, saving the day by
untying the American people from the railroad tracks of runaway capitalism.
Former Clinton Treasury Secretary Lawrence Summers, now a surrogate for
Barack Obama, recently said on NPR: "It's very tempting to always think that
the government should just stand back and let the private sector sort these
problems out. That's the kind of thinking that made the Depression ŒGreat.'"

Jonah Goldberg is editor-at-large of National Review Online,and the author of the book The Tyranny of Clichés. You can reach him via Twitter @JonahNRO.
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